AVITA Medical, Inc. (NASDAQ:RCEL) Q1 2023 Results Conference Call May 11, 2023 4:30 PM ET Company Participants Jessica Ekeberg - Investor Relations James Corbett - Chief Executive Officer Sean Ekins - Acting Chief Financial Officer Conference Call Participants Joshua Jennings - TD Cowen Phillip Dantoin - Piper Sandler Ryan Zimmerman - BTIG Operator Good day and thank you for standing by. Welcome to the AVITA Medical Inc. First Quarter 2023 Earnings Conference Call. At this time all participants are in a lis ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39059 AVITA MEDICAL, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organiza ...

AVITA Medical, Inc. (NASDAQ:RCEL) Q4 2022 Earnings Conference Call February 23, 2023 4:30 PM ET Company Participants Caroline Corner - Managing Director, Investor Relations Jim Corbett - Chief Executive Officer Sean Ekins - Acting Chief Financial Officer Conference Call Participants Joshua Jennings - Cowen Phillip Dantoin - Piper Brooks O'Neil - Lake Street Capital Markets Lyanne Harrison - Bank of America Operator Good day and thank you for standing by. Welcome to AVITA Medical Fourth Quarter 2022 Earnings ...

Part I [Business](index=4&type=section&id=Item%201.%20BUSINESS) AVITA Medical is a regenerative medicine company focused on skin restoration through its proprietary RECELL® System - AVITA Medical is a regenerative medicine company commercializing the RECELL® System, a technology that creates an autologous skin cell suspension (Spray-On Skin™ Cells) to regenerate skin[17](index=17&type=chunk) - The company's core strategy includes increasing penetration in the U.S. burns market, commercializing RECELL for soft tissue repair and vitiligo following anticipated FDA approvals, and expanding internationally, particularly in Japan[30](index=30&type=chunk) - In December 2022, the company submitted a Premarket Approval (PMA) supplement application to the FDA for the use of RECELL in soft tissue repair and a separate PMA application for its use in treating vitiligo[51](index=51&type=chunk)[59](index=59&type=chunk) RECELL System Clinical Benefits | Indication | Key Benefit | | :--- | :--- | | **2nd-Degree Burns** | Used **97.5% less donor skin** compared to standard care | | **3rd-Degree Burns** | Used **32% less donor skin** when combined with autograft | | **Pediatric Cases** | **56% fewer mean surgical procedures** compared to NBR | Estimated U.S. Addressable Markets | Indication | Estimated Annual Market Size | | :--- | :--- | | **Burns** | ~35,000 patients annually | | **Soft Tissue Repair** | ~$1 billion | | **Vitiligo** | ~$5 billion | - The company has a contract with BARDA valued at approximately **$53.3 million** to support the development of the RECELL System and for emergency preparedness[86](index=86&type=chunk)[87](index=87&type=chunk) - The company's core U.S. patent (No. 9,029,140) covering the RECELL System is in force until February 6, 2024, with a Patent Term Extension (PTE) application filed to extend it to **April 9, 2024**[76](index=76&type=chunk)[78](index=78&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20RISK%20FACTORS) The company faces significant financial, operational, and intellectual property risks, including a history of losses and dependency on regulatory approvals - The company has a history of significant losses, reporting a **net loss of $26.7 million** for the year ended December 31, 2022, and has an **accumulated deficit of $262.6 million**[108](index=108&type=chunk) - Future growth is **highly dependent on obtaining additional FDA approvals** for the RECELL System in new indications, such as soft tissue repair and vitiligo[110](index=110&type=chunk) - The company faces manufacturing risks at its Ventura, California facility and **relies on single-source suppliers** for some components, making it vulnerable to supply chain disruptions[127](index=127&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk) - A core U.S. patent for the RECELL System will **expire in February 2024**, which could allow competitors to introduce similar products and impair the company's competitive position[150](index=150&type=chunk) - The business is subject to risks from **unfavorable pricing regulations and third-party reimbursement policies** from government or private insurers[121](index=121&type=chunk)[162](index=162&type=chunk) - Macroeconomic risks, including the ongoing effects of the COVID-19 pandemic, supply chain disruptions, inflation, and potential economic recession, could adversely affect customer demand and operating results[165](index=165&type=chunk)[171](index=171&type=chunk) [Unresolved Staff Comments](index=29&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - There are no unresolved staff comments[191](index=191&type=chunk) [Properties](index=29&type=section&id=Item%202.%20PROPERTIES) AVITA Medical leases its corporate office and production plant in California and does not own any real property - The company's principal corporate office is a **17,500 sq. ft.** leased facility in Valencia, California, with the lease expiring on October 31, 2026[191](index=191&type=chunk) - The production plant is a **27,480 sq. ft.** leased facility in Ventura, California, with a lease through September 30, 2024[191](index=191&type=chunk) [Legal Proceedings](index=29&type=section&id=Item%203.%20LEGAL%20PROCEEDINGS) The company is not currently a party to any material pending legal proceedings - As of the report date, the company is not a party to any material pending legal proceedings[192](index=192&type=chunk) [Mine Safety Disclosures](index=29&type=section&id=Item%204.%20MINE%20SAFETY%20DISCLOSURES) This section is not applicable to the company's operations - Not applicable[193](index=193&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=30&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock and CDIs trade on Nasdaq and ASX respectively, and it does not anticipate paying cash dividends - The company's common stock is listed on the Nasdaq Capital Market (ticker: **RCEL**) and its CDIs are quoted on the ASX (ticker: **AVH**)[196](index=196&type=chunk) - As of January 31, 2023, the company had approximately **23,190 unique stockholders** of record[197](index=197&type=chunk) - The company has **never paid cash dividends** and does not intend to in the foreseeable future, planning to retain earnings for business use[198](index=198&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Total revenue grew 4% to $34.4 million in 2022, driven by commercial sales, while the net loss widened slightly due to increased operating expenses Results of Operations (Year-Ended Dec 31) | Metric | 2022 | 2021 | % Change | | :--- | :--- | :--- | :--- | | **Revenues** | $34.4M | $33.0M | 4% | | Commercial Revenues | $34.0M | $25.1M | 36% | | **Gross Profit** | $28.4M | $26.9M | 5% | | Gross Margin | 82% | 82% | 0% | | **Total Operating Expenses** | $59.1M | $53.6M | 10% | | **Operating Loss** | ($27.5M) | ($25.1M) | (10)% | | **Net Loss** | ($26.7M) | ($25.1M) | (6)% | - The **35% increase in sales and marketing expenses** in 2022 was driven by higher selling costs, pre-commercialization activities for planned new launches, and an increase in field personnel[212](index=212&type=chunk) - Research and development expenses **decreased by 12%** in 2022 as pivotal trials moved into less costly follow-up phases[215](index=215&type=chunk) Liquidity Position as of Dec 31, 2022 | Item | Amount (in millions) | | :--- | :--- | | Cash and cash equivalents | $18.2 | | Marketable securities | $68.1 | - Net cash used in operating activities was **$19.1 million** for the year ended December 31, 2022, an increase from $18.0 million in the prior year[233](index=233&type=chunk) - Critical accounting policies include revenue recognition under ASC 606, accounting for government grants from BARDA, and share-based compensation[243](index=243&type=chunk)[254](index=254&type=chunk)[257](index=257&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, AVITA Medical is not required to provide this information - The company is not required to provide this information as it qualifies as a smaller reporting company[265](index=265&type=chunk) [Financial Statements and Supplementary Data](index=39&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section contains the company's audited consolidated financial statements for fiscal year 2022 and prior periods - The financial statements were audited by Grant Thornton LLP, which issued an **unqualified opinion**[396](index=396&type=chunk) Key Financial Statement Data (as of Dec 31, 2022) | Metric | Amount (in thousands) | | :--- | :--- | | **Balance Sheet** | | | Total Assets | $98,264 | | Total Liabilities | $12,967 | | Total Shareholders' Equity | $84,740 | | **Statement of Operations (FY 2022)** | | | Revenues | $34,421 | | Net Loss | ($26,665) | | **Statement of Cash Flows (FY 2022)** | | | Net Cash Used in Operations | ($19,090) | [Controls and Procedures](index=39&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls, procedures, and internal controls over financial reporting were effective as of year-end 2022 - Management concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2022[268](index=268&type=chunk) - Management concluded that the company's internal control over financial reporting was **effective** as of December 31, 2022, based on the COSO framework (2013)[269](index=269&type=chunk) - **No material changes** were made to the company's internal control over financial reporting during the three months ended December 31, 2022[271](index=271&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=41&type=section&id=Item%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) The company details its board of directors and executive team, committee structures, and compliance with gender diversity targets Board of Directors | Name | Position | | :--- | :--- | | Lou Panaccio | Chairman of the Board | | Jeremy Curnock Cook | Non-Executive Director | | Professor Suzanne Crowe | Non-Executive Director | | Jan Stern Reed | Non-Executive Director | | James Corbett | Executive Director and CEO | Executive Officers | Name | Position | | :--- | :--- | | James Corbett | Chief Executive Officer | | Sean Ekins | Interim Chief Financial Officer | | Erin Liberto | Chief Commercial Officer | | Andrew Quick | Chief Technology Officer | | Donna Shiroma | General Counsel | - The company has achieved its gender diversity target, with the Board of Directors being **40% female** and 60% male[293](index=293&type=chunk) - The Board has three standing committees: Audit, Compensation, and Nominating and Corporate Governance, each composed of independent directors[304](index=304&type=chunk)[305](index=305&type=chunk) [Executive Compensation](index=47&type=section&id=Item%2011.%20EXECUTIVE%20COMPENSATION) Executive compensation comprises base salary, performance bonuses, and long-term equity, with CEO James Corbett's 2022 total compensation at $1.5 million 2022 Summary Compensation for Key NEOs | Name and Position | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | :--- | | **James Corbett**, CEO | 156,992 | 100,726 | - | 1,232,747 | 1,495,584 | | **Michael Holder**, CFO | 430,128 | 184,900 | 178,672 | 82,524 | 925,212 | | **Erin Liberto**, CCO | 421,999 | 180,812 | 178,672 | 82,524 | 906,293 | | **Michael Perry**, Former CEO | 461,512 | - | - | - | 804,498 | - Employment contracts for executive officers provide for severance payments, typically **9-12 months of base salary** and a pro-rated target bonus, upon involuntary termination[326](index=326&type=chunk)[335](index=335&type=chunk) 2022 Non-Employee Director Compensation | Name | Fees in Cash ($) | Stock Awards ($) | Option Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | | **L Panaccio**, Chairman | 126,250 | 87,494 | 31,248 | 244,992 | | **J Curnock Cook** | 90,833 | 87,494 | 31,248 | 209,575 | | **S Crowe** | 95,000 | 87,494 | 31,248 | 213,742 | | **J Reed** | 92,500 | 87,494 | 31,248 | 211,242 | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=53&type=section&id=Item%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) No beneficial owners hold over 5% of common stock, while all executive officers and directors as a group own 4.21% - There are **no known beneficial owners of more than 5%** of the company's common stock as of January 31, 2023[347](index=347&type=chunk) Beneficial Ownership of Management (as of Jan 31, 2023) | Holder | Percentage of Class | | :--- | :--- | | **Michael Perry** (Former CEO) | 1.01% | | **All executive officers and directors as a group (13 persons)** | 4.21% | - As of January 31, 2023, the company had **25,296,086 shares** of common stock outstanding, with a significant portion held as CDIs on the ASX[356](index=356&type=chunk) [Certain Relationships and Related Party Transactions, and Director Independence](index=58&type=section&id=Item%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20PARTY%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) The company reports no material related party transactions and confirms the independence of all board members except for the CEO - The company has not participated in any related party transaction involving more than **$120,000** since January 1, 2021[375](index=375&type=chunk) - All members of the Board of Directors are considered independent, **except for James Corbett**, who serves as the company's Chief Executive Officer[376](index=376&type=chunk) [Principal Accounting Fees and Services](index=58&type=section&id=Item%2014.%20PRINCIPAL%20ACCOUNTING%20FEES%20AND%20SERVICES) Total fees billed by auditor Grant Thornton LLP for 2022 were $740,013, covering audit and tax services Principal Accountant Fees (Year-Ended Dec 31, 2022) | Service | Fees ($) | | :--- | :--- | | Audit Fees | 652,732 | | Tax Fees | 87,281 | | **Total Fees** | **740,013** | - All audit and non-audit services provided by the independent registered public accounting firm were **pre-approved by the Audit Committee**[380](index=380&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=59&type=section&id=Item%2015.%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists all documents filed with the report, including financial statements, material contracts, and corporate governance documents - This item provides an index of all financial statements, schedules, and exhibits filed with the Form 10-K[382](index=382&type=chunk) - Exhibits include corporate governance documents, material contracts (including the BARDA agreement), lease agreements, and executive compensation plans and agreements[384](index=384&type=chunk)[385](index=385&type=chunk) [Form 10-K Summary](index=61&type=section&id=Item%2016.%20Form%2010-K%20Summary) This section is noted as 'None', indicating no summary is provided - No Form 10-K summary is provided[387](index=387&type=chunk)

AVITA Medical, Inc. (NASDAQ:RCEL) Q3 2022 Earnings Conference Call November 10, 2022 4:30 PM ET Company Participants Caroline Corner - Managing Director, Investor Relations Jim Corbett - Chief Executive Officer Michael Holder - Chief Financial Officer Conference Call Participants Charlie Montang - Lake Street Capital Matthew O’Brien - Piper Sandler Ryan Zimmerman - BTIG Joshua Jennings - Cowen Madeleine Williams - Wilsons Operator Good day and thank you for standing by and welcome to AVITA Medical Third Qua ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Commission File Number: 001-39059 AVITA MEDICAL, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 85-1021707 (IRS Employer Identification No.) 28159 Avenue Stanford FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION ...

Financial Data and Key Metrics Changes - The company reported record commercial RECELL revenues of $8.2 million for Q2 2022, a 23% increase from $6.7 million in the same quarter last year [9] - Total revenue for Q2 2022 was $8.3 million, down from $10.3 million in the prior year, which included $3.6 million in BARDA revenue [32] - Gross profit margin improved by 3% to 83% compared to the prior year [33] - Net loss increased by 33% to $6.3 million, or $0.25 per share, compared to a net loss of $4.7 million, or $0.19 per share, in the prior year [35] - Adjusted EBITDA loss increased by 51% to $4.7 million compared to $3.1 million in the prior year [36] Business Line Data and Key Metrics Changes - Commercial revenue for the first half of 2022 was $15.7 million, a 39% increase from $11.3 million in the same period last year [10] - The company achieved greater penetration and a larger base of accounts, leading to an increase in burn cases treated with RECELL [11] - The outpatient market is expected to become a larger portion of the addressable market, with ongoing efforts to familiarize centers with outpatient care pathways [14] Market Data and Key Metrics Changes - In Japan, the company completed its first training and evaluation cases during the quarter, with ongoing discussions regarding reimbursement and pricing [15] - The company anticipates that outpatient treatment will comprise the core soft tissue market, supporting continued growth [14] Company Strategy and Development Direction - The company is focused on driving healthcare provider engagement through education and maintaining momentum in burn treatments [28] - Plans to submit PMA supplements for soft tissue reconstruction and vitiligo indications by the end of 2022, with market entry anticipated in the second half of 2023 [29] - The company aims to leverage its existing infrastructure to launch RECELL in trauma centers co-located with burn centers [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving projected commercial revenue of approximately $30 million for 2022, representing a 20% year-over-year increase [42] - Concerns were raised regarding potential supply chain issues, macroeconomic factors, and staffing shortages in hospitals affecting growth [55] - Management noted that labor shortages have stabilized but have not improved, with increased training efforts to address staffing challenges [56] Other Important Information - The company is developing an automated RECELL device to improve efficiency in dermatology practices [24] - The RECELL system is expected to differentiate itself in the vitiligo market due to its strong safety record and treatment procedure [26] Q&A Session Summary Question: Clarification on soft tissue trial data and non-inferiority - Management explained that while donor skin sparing was statistically significant, non-inferiority for healing was not met at the pre-specified level, but they remain confident in the PMA submission [45][46] Question: Safety events in the study - Management confirmed that there were no differences in adverse events between the control and treated groups [49] Question: Updates on vitiligo trial data presentation - Management indicated that top-line data from the vitiligo trial would be released shortly, and they are currently pursuing a go-it-alone strategy for commercialization [51] Question: Guidance for the second half of the year - Management reiterated confidence in the $30 million revenue guidance, citing seasonality and external factors as reasons for not increasing guidance [55] Question: Labor shortages and improvements - Management noted that while labor shortages have stabilized, they have not improved, and training efforts have increased to address this issue [56] Question: Adoption and reimbursement in Japan - Management expressed optimism about reimbursement discussions in Japan and indicated that they expect favorable pricing [63][64] Question: Maintenance of gross margins - Management stated that they aim to maintain gross margins at the low 80% level moving forward [67]

[Forward-Looking Statements](index=4&type=section&id=FORWARD-LOOKING%20STATEMENT) This report contains forward-looking statements regarding future revenues, market conditions, operations, and growth, subject to known and unknown risks and uncertainties - This report contains forward-looking statements regarding future revenues, market conditions, operations, and growth, which are subject to known and unknown risks and uncertainties[8](index=8&type=chunk)[10](index=10&type=chunk) - The company qualifies all forward-looking statements with cautionary statements and does not plan to publicly update them except as required by law[11](index=11&type=chunk) [PART I – FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section presents the unaudited consolidated financial statements, management's discussion, market risk, and internal controls for the period ended June 30, 2022 [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three and six months ended June 30, 2022, including detailed notes and reporting a net loss of $6.3 million for Q2 2022 [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) The company's total assets decreased to $102.7 million as of June 30, 2022, from $116.0 million at December 31, 2021, mainly due to reduced cash and cash equivalents Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $91,806 | $92,132 | | **Total Assets** | $102,669 | $116,015 | | **Total Current Liabilities** | $7,886 | $9,146 | | **Total Liabilities** | $9,946 | $11,391 | | **Total Shareholders' Equity** | $92,560 | $104,624 | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) For Q2 2022, revenues decreased by 19% to $8.3 million, and the net loss increased to $6.3 million, with a six-month net loss of $15.7 million Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | $8,335 | $10,304 | $15,874 | $19,069 | | **Gross Profit** | $6,949 | $8,251 | $12,710 | $14,870 | | **Operating Loss** | $(6,362) | $(4,704) | $(15,849) | $(10,695) | | **Net Loss** | $(6,261) | $(4,718) | $(15,724) | $(10,715) | | **Net Loss per Share (Basic & Diluted)** | $(0.25) | $(0.19) | $(0.63) | $(0.45) | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities for the first six months of 2022 was $12.9 million, leading to a decrease in cash and cash equivalents to $34.9 million Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2022 | 2021 | | :--- | :--- | :--- | | **Net cash used in operations** | $(12,877) | $(12,536) | | **Net cash used in investing activities** | $(7,845) | $(526) | | **Net cash provided by financing activities** | $1 | $64,058 | | **Net (decrease)/increase in cash** | $(20,773) | $50,981 | | **Cash at end of period** | $34,939 | $110,947 | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue recognition, marketable securities, and share-based compensation, highlighting the RECELL® System and BARDA contract - AVITA is a commercial-stage regenerative medicine company whose lead product, the RECELL® System, is used for treating burns and other skin defects[34](index=34&type=chunk) - The company is pursuing expanded FDA approvals for soft tissue reconstruction and vitiligo[34](index=34&type=chunk) - Revenue is recognized from the sale of the RECELL System to hospitals and BARDA[47](index=47&type=chunk)[49](index=49&type=chunk)[106](index=106&type=chunk) - The BARDA contract includes two performance obligations: product procurement (revenue recognized at a point in time) and emergency preparedness services (revenue recognized over time)[47](index=47&type=chunk)[49](index=49&type=chunk)[106](index=106&type=chunk) - The company's marketable securities, consisting of corporate debt, U.S. government agency obligations, and U.S. treasury securities, are classified as available-for-sale and carried at fair value[63](index=63&type=chunk) - Share-based compensation expense for the three and six months ended June 30, 2022, was **$1.4 million** and **$4.3 million**, respectively, recognized under the 2020 Omnibus Incentive Plan[115](index=115&type=chunk)[118](index=118&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the 19% decrease in Q2 2022 total revenue due to lower BARDA revenue, offset by 23% commercial revenue growth, and confirms sufficient cash for the next 12 months [Overview](index=34&type=section&id=Overview) The company provides an overview of its RECELL® System, recent regulatory approvals, ongoing trials, and the continued business impact of the COVID-19 pandemic - The company's lead product is the RECELL® System, a device for producing Spray-On Skin™ Cells for treating burns, trauma, and other skin defects[147](index=147&type=chunk) - Recent regulatory milestones include FDA approval for pediatric burns (2021), an enhanced RECELL device (Feb 2022), and PMDA approval in Japan (Feb 2022)[147](index=147&type=chunk)[151](index=151&type=chunk) - The COVID-19 pandemic continues to pose risks, impacting hospital access, clinical trial enrollment, and overall operations, prompting measures like hybrid work schedules and enhanced safety protocols[155](index=155&type=chunk)[156](index=156&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) This section details the financial performance for Q2 2022, showing a 19% YoY revenue decline driven by non-recurring BARDA revenue, despite 23% commercial revenue growth Q2 2022 vs. Q2 2021 Financial Comparison (in millions) | Metric | Q2 2022 | Q2 2021 | Change (%) | | :--- | :--- | :--- | :--- | | **Total Revenues** | $8.3 | $10.3 | (19%) | | **Commercial Revenue** | $8.2 | $6.7 | 23% | | **BARDA Revenue** | $0.1 | $3.6 | (97%) | | **Operating Loss** | $(6.4) | $(4.7) | (35%) | - Sales and marketing expenses increased by **29%** in Q2 2022 due to pre-commercialization costs for new indications (soft tissue, vitiligo), increased field personnel, and higher share-based compensation[163](index=163&type=chunk) - Research and development expenses decreased by **23%** in Q2 2022, reflecting that certain clinical programs were in lower-cost phases during the quarter[165](index=165&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company confirms sufficient cash reserves of $34.9 million to fund operations for the next 12 months, with no significant external borrowing - The company has sufficient cash reserves to fund operations for the next 12 months[174](index=174&type=chunk) Cash Position and Flows (in thousands) | Metric | Six Months Ended June 30, 2022 | | :--- | :--- | | **Cash and cash equivalents at end of period** | $34,939 | | **Net cash used in operations** | $(12,877) | | **Net cash used in investing activities** | $(7,845) | | **Net cash provided by financing activities** | $1 | - The company has no significant external borrowing and is not subject to externally imposed capital requirements[180](index=180&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is not required to provide market risk disclosures as it qualifies as a smaller reporting company - As a smaller reporting company, AVITA Medical is not required to provide quantitative and qualitative disclosures about market risk[183](index=183&type=chunk) [Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2022, with no material changes in internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2022[184](index=184&type=chunk) - No changes in internal controls over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[186](index=186&type=chunk) [PART II – OTHER INFORMATION](index=41&type=section&id=Part%20II%20%E2%80%93%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, unregistered sales of equity securities, and a list of exhibits filed with the report [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that there are no legal proceedings - None[187](index=187&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.Risk%20Factors) This section directs readers to the 'COVID-19 Business Update and Risks Associated with COVID-19' discussion in Part I for risk factor information - The report refers to the COVID-19 risk discussion in Part I for risk factor information[188](index=188&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities or use of proceeds - None[189](index=189&type=chunk) [Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Form 10-Q, which include certifications from the Chief Executive Officer and Chief Financial Officer, as well as Inline XBRL data files - The exhibits filed with the report include Rule 13a-14(a) certifications by the CEO and CFO, Section 1350 certifications, and various Inline XBRL documents[193](index=193&type=chunk)

One Platform. Endless Possibilities. May 2022 NASDAQ: RCEL ASX: AVH ©Copyright 2022 AVITA Medical. All Rights Reserved. Legal Disclaimers Certain statements in this presentation and the accompanying oral commentary are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this presentation, including statements regarding our future financial condition, technology platform, development str ...

AVITA Medical, Inc. (NASDAQ:RCEL) Q1 2022 Earnings Conference Call May 12, 2022 4:30 PM ET Company Participants Caroline Corner - Managing Director, Investor Relations Mike Perry - Chief Executive Officer Michael Holder - Chief Financial Officer Conference Call Participants Josh Jennings - Cowen Matthew O'Brien - Piper Sandler Ryan Zimmerman - BTIG Lyanne Harrison - Bank of America John Hester - Bell Potter Operator Good day and thank you for standing by. Welcome to the AVITA Medical Inc. First Quarter 2022 ...